Italy's Boardroom Broom May Make Bigger Mess

The Italian government wants to clean up corporate Italy. Investors in state-controlled companies should be wary that even well-intentioned rules don't end up binding boards' hands.

Italy's Economy Ministry has written to the largest state-backed companies, including ENI and Enel, asking them to add a vote to amend their bylaws at their next shareholder meetings. The proposal would effectively compel boards to remove any director...